Park District courting trouble with pensions

Chicago Park District officials are playing a dangerous, deceptive game with employee pension funding.

It came to light last week that the Park District skipped $10 million in contributions to its pension funds over the past two fiscal years, opting instead to divert the money to operating expenses.

That's dangerous because the district has a large and growing pension funding gap. The shortfall between the assets in its pension funds and its long-term obligations to current and future retirees is expected to exceed 20% soon. Every dollar diverted brings the district that much closer to a pension funding crisis.

It's also deceptive, because the Park District collected the $10 million under a property tax levy specifically intended to raise money for pension funding. Taxpayers, therefore, thought they were kicking in money to shore up the district's sagging pensions. True, state lawmakers gave the district a pass on the pension contributions for two years. But parks officials never told taxpayers their money would be spent elsewhere. Park District budgets for fiscal 2004 and 2005  the years in which pension money went to operating expenses  make no mention of the diversion.

That kind of accounting obfuscation gets corporate executives sued, a fate that may await parks bosses. They ought to be as accountable to taxpayers as their corporate counterparts are to shareholders. But you can't have accountability without full disclosure.

Perhaps it's not surprising that Park District officials weren't eager to tell the public what they did with the money collected for pensions. To do so would have highlighted the weak state of Park District finances and their own unwillingness to confront the expanding pension gap, a financial elephant in the living rooms of government bodies around the country.

Closing the gap could require painful choices like cutting parks services and slashing pension benefits, moves sure to offend the public at large and politically influential unions representing Park District workers. But these moves may be necessary to protect future taxpayers from the financial fallout of a pension funding meltdown.